Logistics set for more change following TDG takeover

"This could make ND UK number one in the temperature controlled sector," said Chris Sturman, chief executive of the Food Storage and Distribution Federation, of which ND and TDG are members. "This could take back the lead from Yearsley Group."

With its headquarters at Manchester in the UK, TDG employs 6,300 people, boasts 2009 turnover of £662M and generates 74% of its revenue from the UK. The combined group would have potential international annual revenues of £2.86bn.

Sturman also acknowledged the move reflected the growing interest in freight forwarding, which "makes more margin" than traditional dedicated logistics services. "This is where firms such as TNT are making good returns: areas such as express distribution and freight forwarding global, multi-modal logistics."

ND chief executive Francois Bertreau said the move would give it stronger positions in transport and logistics in addition to freight forwarding: "While retaining our financial flexibility this transaction consolidates our presence in each of our three sectors and considerably strengthens our freight forwarding business, allowing us to better meet the needs of our clients at international level."

ND business unit director Dan Myers had previously stressed to Food Manufacture the increasing importance of freight forwarding.

Sturman said there was room for further UK consolidation yet. Another logistics industry source said: "This could also be a significant precursor to further consolidation in the logistics sector as pressure increases on the supply chain to offer economies of scale and secure supply for large commercial contracts."

ND and TDG have been quick to say there will be no changes to services or structure before the anticipated ratification of the deal by European competition authorities by mid January.

ND announced the acquisition of 100% of the share capital of Laxey Logistics, a holding company that owns TDG, last month. A spokeswoman for ND said it was too early to comment on the long term strategy for the business.